Customer retention in project accounting in Microsoft Dynamics 365 for Finance and Operations One version

Customer retention in project accounting in Microsoft Dynamics 365 for Finance and Operations One version

Wondering to leverage customer retention feature in D365FO when customers would like to withhold payment for part of an invoice until certain terms are met.

Sharing the feature with visuals:

1) Setup number sequence for Customer payment retention term in Projects parameters

2) Define a customer retention term e.g. withhold x% when y% of project is complete/deliverables met

3) Define Customer retention Default GL account in path General Ledger → Setup → Postings → Accounts for automatic transactions

4) Ensure on the GL/main account the posting type is selected as customer payment retention

5) Create a new project category for customer retention

6) Apply Customer payment retention terms on contract funding source

• Ensure default line property on project is billable
• Invoice the project and witness the customer retention % and amount in the invoice proposal.

Tips:

• Configure project invoice revenue account even though it is not going to be used.
• Assign customer retention to billing rule if it is being used

Once the transactions are getting posted with the customer retention defined on project, in each of the invoice proposal you should see the retention amount.

The last step is to initiate a process - REQUEST RETAINED AMOUNT' using path 

Project management and accounting > Common > Projects > All Projects > Manage > Customer retained payment

Review the retentions and generate an invoice proposal.

Happy D365FO!!!